FINAL PERMIT APPLICATION REVIEW SUMMARY

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1 FINAL PERMIT APPLICATION REVIEW SUMMARY New Hampshire Department of Environmental Services Air Resources Division P.O. Box 95, 29 Hazen Drive Concord, NH Phone: Fax: Location: 231 Fisher Corner Rd., Springfield, NH (Sullivan County) Phone #: AFS #: Application #: FY Date: Aug. 8, 2007 Page 1 of 8 APPLICATION & OTHER COMMUNICATION: Date Description 05/02/05 DES received the permit application package 08/08/07 DES issued the permit FACILITY DESCRIPTION Durgin & Crowell Co., Inc. (D&C) operates a sawmill and planing mill (SIC code 2421) at 231 Fisher Corner Road in Springfield, New Hampshire. Springfield is located in Sullivan County. D&C s mail is sent to 231 Fisher Corner Road with New London being listed as the town. The facility pays all applicable taxes to the city or town of Springfield. In support of the sawmill and planing mill, D&C owns and operates a heating and energy plant composed of three prime power generators (internal combustion engines), one emergency generator for emergency lighting, two oil-fired boilers and one wood-fired boiler for process steam (18 kilns) and building heat requirements. The facility had a roof collapse and a fire which caused significant damage in 2001, with the facility ramping back to normal operations in July PROJECT DESCRIPTION D&C has applied for the renewal of its State Permit to Operate FP-S-0118, issued on July 27, 2000, with an expiration date of July 31, D&C has an Administrative Order by Consent, ARD , effective April 4, 2000, which restricts the facility to use on road diesel fuel for all engines at the facility. The permit issued in 2000 listed the fuel sulfur content limit of 0.025% sulfur by weight. Note that DES does not regulate on road diesel fuel. It should also be noted that the United States Environmental Protection Agency is lowering the sulfur content by weight percent of on road diesel fuel to 0.05% sulfur by weight on October 1, 2007 and to % sulfur by weight on October 1, DES will be limiting D&C to use on-road diesel fuel in its 3 Engines, Emergency Generator, and 2 Boilers. Emissions calculations and modeling in this permit are based on the use of on road diesel fuel with a maximum sulfur content of 0.05% sulfur by weight. The facility conducted stack testing of its Engines and Wood-fired Boiler in May As a result of the stack testing of the Wood-fired Boiler, it has been determined that its maximum heat input rate is really 15.5 MMBtu/hr rather than the 10.0 MMBtu/hr that has been included in all of the previous operating permits. The maximum heat input capacity of the Wood-fired Boiler has been updated in this permit to be 15.5 MMBtu/hr. The higher heating value of the as fired fuel at 45% moisture was determined to be 4,640 Btu/lb and the boiler is capable of firing up to 1.67 tons/hr of fuel, not the previously used figure of 1.09 tons/hr. Hence, the maximum gross heat input of the Wood-fired Boiler is calculated below: ((4,640 Btu/lb X 2,000 lb/ton)/1,000,000) X 1.67 tons/hr = 15.5 MMBtu/hr. D&C has been receiving all of its power from Public Service Company of New Hampshire since February 11, 2006, but wishes to be able to run its three Engines as peak shaving units during summer months or periods of high electricity demand. PROCESS/DEVICE DESCRIPTION Wood-fired Boiler (WFB) Industrial Boiler, Model , Serial Number H , Started up in 1978, rated at 15.5 MMBtu/hr via stack testing conducted in May 2005, maximum firing rate of 1.67 tons/hr wood waste. Engine #1 Caterpillar, Model 3512B, Serial Number 1GZ01502, Started up in October 2004, 1971 Hp, 13.9 MMBtu/hr from on road diesel fuel, maximum firing rate of gal/hr, assuming 137,000 Btu/gal heating value for diesel fuel. Engine #2 Caterpillar, Model 3512B, Serial Number 8RM00284, Started up in March 1999, 1971 Hp, 13.9 MMBtu/hr from on road diesel fuel, maximum firing rate of gal/hr, assuming 137,000 Btu/gal heating value for diesel fuel.

2 AFS #: Application #: FY Date: August 8, 2007 Page 2 of 8 Engine #3 Caterpillar, Model 3512B, Serial Number 1GZ02135, Started up in November 2004, 1971 Hp, 13.9 MMBtu/hr from on road diesel fuel, maximum firing rate of gal/hr, assuming 137,000 Btu/gal heating value for diesel fuel. Emergency Generator (EG) - Caterpillar, Model 3306B, Serial Number 85Z02737, Installed in 1981, 343 Hp, 2.34 MMBtu/hr from on road diesel fuel, 17.1 gal/hr assuming 137,000 Btu/gal heating value for diesel fuel. Emergency use only, i.e., less than 500 hours per year, and no load shaving allowed. POLLUTION CONTROL EQUIPMENT There are no pollution controls on any of the combustion equipment at the facility. EMISSION CALCULATIONS See attached calculation sheets. Actual and potential emissions of CO, NOx, and PM10 for the Wood-fired Boiler were based on use of emissions factors (lb/mmbtu) developed from June 2005 stack testing data plus a 10% safety factor added. Actual and potential emissions of SO2 and VOC for the Wood-fired Boiler were based on use of USEPA AP-42 5 th Edition, Chapter 1.6, Wood Residue Combustion in Boilers, Updated in September 2003 emissions factors (lb/mmbtu). The actual emissions for the Woodfired Boiler were based on use of the facility s mass balance approach for determining the total quantity of sawdust and dry waste (board ends) burned, in that the Boiler feedwater flowmeter was out of calibration during the testing conducted in June This mass balance approach has been reviewed by Tara Olson, Joe Tristaino, and myself and found to adequately estimate emissions from the Wood-fired Boiler. For purposes of compliance with annual emissions limitations in this permit, the mass balance method shall be used to calculate actual emissions from the wood-fired Boiler. The facility shall also perform the boiler feedwater method in calculating actual annual emissions and submit these calculations/results in addition to the mass balance method with the annual emissions report. The permit will require the facility to calibrate the Boiler feedwater flowmeter once a year following manufacturer s specifications, in order to ensure proper calculation of annual emissions using the boiler feedwater method. Potential emissions from the Wood-fired Boiler used in modeling were based on a maximum heat input rate of 15.5 MMBtu/hr with the emissions factors as described above and included on the attached Exel Emissions Calculations spreadsheets. Below are the two approved methods of calculating actual emissions of criteria pollutants from the Wood-fired Boiler: 1. Mass Balance Method This mass balance approach is based on the total board feet of lumber sawed in a year and a factor of 0.33 tons sawdust generated/1,000 board feet of lumber sawed, minus the tons of sawdust sold, and addition of the total tons of dry waste burned (board ends), as shown below from the 2005 calendar year emissions report. Total tons of sawdust produced in 2005 = 34,000 (1,000 board feet) X 0.33 tons sawdust/1,000 board feet = 11,220 tons sawdust produced - 3,630 tons sawdust sold = 7,590 tons sawdust burned tons dry waste burned (board ends) = 7,884 tons sawdust and dry wood waste burned in Boiler Feedwater Flow Method ((Total feedwater gal/week) X (2.88 lb fuel/gal feedwater))/2,000 lb/ton = tons sawdust burned per week 105,420 gal/week X 2.88 lb fuel/gal feedwater)/2,000 lb/ton 303,609.6 lb sawdust/week/2,000 lb/ton = tons sawdust burned/week The facility then sums up the tons sawdust burned/week for each week of the year to determine the total quantity of fuel combusted in a calendar year.

3 AFS #: Application #: FY Date: August 8, 2007 Page 3 of 8 STACK INFORMATION WFB 56 ft agl, 1.75 ft diameter Engine #1 44 ft agl, 1.17 ft diameter Engine #2 44 ft agl, 1.17 ft diameter Engine #3 44 ft agl, 1.17 ft diameter MODELING See the attached modeling memo. Note that this facility was remodeled due to the change in the maximum heat input rate from 10 to 15.5 MMBtu/hr for the Wood-fired Boiler and for a maximum of 0.05% sulfur content by weight for all on road diesel fuel fired in all of the Engines at the facility. Note that Engines #1-3 and the Emergency Generator have a combined fuel use cap of 560,000 gallons per consecutive 12 month period and the Emergency Generator is not to be run simultaneously with any of the three prime power Engines. The 3 Engines and Wood-fired Boiler were modeled running simultaneously at their maximum hourly emissions rates and the facility was found to meet all National Ambient Air Quality Standards. EMISSION TESTING May 19, 2005 Engines #1-3 Tested in load sharing operation. Engine #1 NOx = lb/mmbtu, CO = lb/mmbtu Engine #2 NOx = lb/mmbtu, CO = lb/mmbtu Engine #3 NOx = lb/mmbtu, CO = lb/mmbtu May 20, 2005 Wood-fired Boiler tested. Determined that maximum heat input rate is 15.5 MMBtu/hr, which is above the 10 MMBtu/hr in the current permit and in all permit applications. NOx = lb/mmbtu, CO = lb/mmbtu, TSP = lb/mmbtu SITE VISITS/INSPECTIONS Date Description 9/03/02 Facility had not been inspected since 1994 and DES had not received any operational or emissions reports for calendar years 1999 through Dick Andrews (Air Resources Division) provided a copy of the permit to Mr. Ruggles and explained the recordkeeping and reporting requirements. Mr. Ruggles indicated they had an outside consultant who would prepare all necessary reports. DES asked the facility to submit all required reports for 1999 through 2001 and to pay all emissions-based fees for this period. 07/06 Ray Walters conducted a site inspection. The final report has not been released as of this date. REPORTS/FEES Annual Emission Reports The 2006 annual emissions report was received April 16, See the table below for the 5 years of previous calendar year emissions reported to DES. Year NOx SO 2 TSP CO VOC Fees 2006 annual emissions-based fees were received and logged in on April 17, 2007.

4 AFS #: Application #: FY Date: August 8, 2007 Page 4 of 8 REVIEW OF REGULATIONS State Regulations Env-A (a) Not applicable to the 2 diesel oil-fired Boilers at the facility Durgin and Crowell has two diesel oilfired Boilers at the facility, which are rated at 9.73 and 8.22 MMBtu/hr, which is below the 10.0 MMBtu/hr threshold in Env-A (a). Therefore, these two emissions units are not permitted devices. Env-A (c) Applicable to the Wood-fired Boiler (WFB) The WFB requires an operating permit in that it has a heat input rate greater than 2 MMBtu/hr while firing wood. Env-A (d)(3) Applicable to Engines #1, #2, #3, and the Emergency Generator - All of the Engines and the Emergency Generator require an operating permit because the combined potential to emit of NOx emissions is greater than 25 tons per consecutive 12 month period. Env-A 705 Applicable facility wide Payment of emissions-based fee and NOx emissions reduction fund fee (if applicable) by April 15 th the following year Env-A /04 Applicable facility wide - Pre-test Notice and Protocol Env-A Applicable facility wide Pre-test meeting Env-A Applicable facility wide Report submission requirement Within 60 days of completion of testing Env-A (d)-(f) Applicable to Engines #1, #2, and #3 NOx RACT Testing of Engines #1-3 is required once every three years, including the specified Methods. Note that if an Engine is not run for greater than 12 consecutive months prior to the required NOx RACT testing date, the facility must file a waiver request with the Division requesting a delay in testing until the unit is brought back in operation. Env-A Applicable facility wide Retain records of sulfur content for each load of diesel fuel received. Env-A Applicable facility wide Availability of records Must maintain records for a period of 5 years from the date of such record. Env-A Applicable facility wide Recordkeeping requirements for combustion sources Env-A Applicable facility wide General NOx recordkeeping requirements Env-A 906 Applicable facility wide Additional recordkeeping requirements Consecutive 12 month running total of device specific and facility wide NOx emissions done each month: Consecutive 12 month rolling total fuel consumption for Engines #1-3 combined done each month; Consecutive 12 month rolling total fuel consumption for the Wood-fired Boiler done each month; and Consecutive 12 month rolling total of hours of operation for the Emergency Generator. Env-A Applicable facility wide Annual emissions report due by April 15 th the following calendar year for the previous calendar year. Env-A 910 Applicable facility wide Quarterly Reports to be submitted to DES within 30 days of the end of each calendar quarter, to include the following information: 1. Consecutive 12 month rolling total of device specific and facility wide NOx emissions for each of the three months in the reporting period; 2. Consecutive 12 month rolling total combined fuel consumption for the three Engines for each of the three months in the reporting period;

5 AFS #: Application #: FY Date: August 8, 2007 Page 5 of 8 3. Consecutive 12 month rolling total hours of operation for the Emergency Generator for each of the three months in the reporting period; and 4. Summary report of sulfur content of each load of diesel fuel delivered to the facility during the quarter. Env-A (b) Applicable facility wide Permit deviation reporting requirements Env-A (j)(1) Applicable to the Emergency Generator - Less than 500 hours operation per consecutive 12 month period for the Emergency Generator. Env-A (o) Applicable to the Emergency Generator - Definition of emergency generator, applies to the Emergency Generator, i.e., it can not be used as a load shaving unit, such as instances where PSNH needs load to be dropped from area customers to reduce demand. Env-A (b)(1) Applicable to the WFB An annual tune-up is required for the Wood-fired Boiler. Env-A (b)(2) Applicable to the WFB Maintain required records of Wood-fired Boiler tune-ups. Env-A (Stationary Internal Combustion Engines) - Applicable to Engines #1, #2, #3 8 grams per brake horsepower-hour NO x emission limit for Engines #1-3. Note that the previous permit issued on July 27, 2000 had an emissions limit of 7.1 grams per brake horsepower hour and DES can not set limits more stringent than NO x RACT unless modeling shows that the facility can not meet the National Ambient Air Quality Standards for NO x and requires a more stringent emissions limit or operational limitation. Env-A 1400 Not applicable facility wide - Env-A (b)(4)c. and d. exempt regulated toxic air pollutant emissions that are from or result from any of the following sources, in this case, untreated wood and virgin petroleum products Env-A Applicable facility wide - Less than 20% opacity for all combustion devices Env-A (c)(1) Applicable to the Emergency Generator Total suspended particulate matter emissions less than 0.6 lb/mmbtu Env-A (c)(2) Applicable to the WFB Total suspended particulate matter in lb/mmbtu less than X (MMBtu/hr) Env-A (c)(1) Applicable to Engines #1, #2, and #3 Total suspended particulate matter less than 0.30 lb/mmbtu Env-A (a) and (c) Applicable to Engines #1, #2, and #3 This standard will apply beginning November 18, 2007 to all 3 Engines used for prime power production, in that they were permitted devices prior to July 1, 1999 and/or like-kind replacements at the same rated capacity and NOx emissions were lower than the Engines they replaced. Env-A (d) Potentially Applicable to Engines #1, #2, and #3 NOx-emitting generation sources shall not include any generators which emit, in total from the facility, 5 tons of NOx or less per calendar year. In other words, Durgin & Crowell could potentially use all three Engines for a limited period of time during the year and if the total NOx emissions from all of the Engines combined is less than 5 tons per calendar year, they would not be subject to Env-A 3700 for that calendar year. Env-A Applicable to Engines #1, #2, and #3 Power generation monitoring and calculations. Env-A Applicable to Engines #1, #2, and #3 Recordkeeping requirements for NOx-emitting generation sources.

6 AFS #: Application #: FY Date: August 8, 2007 Page 6 of 8 Env-A Applicable to Engines #1, #2, and #3 Reporting requirements for NOx-emitting generation sources. Env-A & Applicable to Engines #1, #2, and #3 Calculation of NOx emissions reduction fund fees. If D&C wants to take credits for NOx emissions from non-electric services, such as providing building heat or hot water, it must submit a written request in accordance with Env-A (a) to the Division. State Permit to Operate FP-S-0118 Applicable to Engines #1, #2, #3, and the Emergency Generator - Combined fuel use cap of 560,000 gallons on road diesel fuel per consecutive 12 month period for the 3 Engines and Emergency Generator combined. Temporary Permit FP-T-0021 (10/02/1998) Applicable to Engines #1, #2, and #3 Fuel flow meters and totalizers shall be installed and continuously operated on both the inlet and outlet fuel feed lines for Engines #1-3. The flow meters and totalizers shall meet ASTM performance specifications and be calibrated in accordance with ASTM (or other standardized) procedures. Calibration shall take into consideration differences in fuel density resulting from temperature changes between inlet and outlet fuel flows. State Permit to Operate FP-S Applicable to the Emergency Generator An hour meter shall be continuously operated on the Emergency Generator to log total hours of operation of the device. State Permit to Operate FP-S-0118 (new requirement) Applicable to the WFB Maximum fuel consumption for the Wood-fired Boiler shall be less than 14,629 tons per year, as fired basis = 1.67 tons/hr X 8,760 hr/yr. State Permit to Operate FP-S-0118 (new requirement) Applicable to the WFB D&C shall calculate and record weekly fuel consumption in tons/week for the Wood-fired Boiler according to the following equation: ((Total gallons Boiler Feedwater/week) X (2.88 lb fuel/gal feedwater))/2000 lb/ton = tons wood fuel burned/week. Annual fuel consumption will then be the sum of the weekly fuel burned for the 52 weeks during each calendar year. The facility will be required to continuously monitor the boiler feedwater and do a calibration check once a year to the boiler feedwater flowmeter in accordance with the manufacturer s specifications. The facility will also be required to use the sawdust mass balance method for calculating the annual wood consumption by the Wood-fired Boiler and calculate actual annual emissions of the Boiler. For purposes of compliance with the annual emissions limitations, the sawdust mass balance method shall be used. Durgin & Crowell shall submit both the actual annual emissions for the wood-fired Boiler calculated by the mass balance method and the boiler feedwater method with its annual emissions report to DES. See page 2 of this Engineering Summary for detailed information required for calculating the annual fuel combusted in the Wood-fired Boiler using the Mass Balance Method and the Boiler Feedwater Flow Method. Administrative Order By Consent ARD Applicable to Engines #1, #2, #3, and the Emergency Generator - Only use on road diesel fuel in all of the Engines (Engines #1-3) and the Emergency Generator. See Items 1 through 4 in Table 5 of the State Permit to Operate for device specific emissions limitations and facility wide emissions limitations and the attached Exel calculation worksheets for the basis of the emissions limitations. Note that the two small diesel oil-fired Boilers emissions are included in the facility wide emissions limitations. These two Boilers were included in previous permits for the facility, but they are below the permitting threshold of 10 MMBtu/hr, and not included in this permit as permitted devices. Federal Regulations 40 CFR 60 Subpart Dc Standards of Performance for Small Industrial-Commercial-Institutional Steam Generating Units This standard applies to any boiler constructed, reconstructed, or modification is commenced after June 9, 1989 and has a design maximum heat input capacity between 10 and 100 MMBtu/hr. While the Wood-fired Boiler is above 10 MMBtu/hr gross heat input rate, it was installed/operational in 1978, which is prior to June 9, Hence, Subpart Dc does not apply

7 AFS #: Application #: FY Date: August 8, 2007 Page 7 of 8 to the Wood-fired Boiler. Both of the diesel oil-fired Boilers are below 10 MMBtu/hr gross heat input rate, so Subpart Dc does not apply to the two diesel oil-fired Boilers. 40 CFR 60 Subpart IIII - There are New Source Performance Standards for reciprocating internal combustion engines that are of the compression ignition type, contained in 40 CFR 60 Subpart IIII, which is effective September 11, This standard does not apply to existing engines manufactured prior to April 1, Hence, this Subpart does not apply to any of the three Engines at D&C. 40 CFR Sulfur content limit less than 0.05% sulfur by weight or 500 ppm for on road diesel fuel. After October 1, 2010, the sulfur content limit will be % sulfur, by weight, or 15 ppm, for on road diesel fuel. CHANGES FROM PREVIOUS PERMIT The gross heat input rate of the Wood-fired Boiler has been updated from 10.0 to 15.5 MMBtu/hr as a result of stack testing conducted in May In addition, DES has included a new fuel use restriction of 14,629 tons per consecutive 12 month period for the Wood-fired Boiler to ensure that the unit is not capable of firing more than 1.67 tons/hr wood fuel on an as-fired basis. The previous permit had a 10,000 ton/yr wood fuel use restriction at 50% moisture content by weight. This permit requires monitoring of the boiler feedwater in order to calculate fuel combusted using the Boiler Feedwater method, with calibration checks of the boiler feedwater flowmeter once annually, in accordance with the manufacturer s specifications. In addition, the facility will calculate annual fuel combusted in the Boiler by use of the mass balance approach, which will be the preferred method for showing compliance with facility wide annual emissions limitations in this permit. Use of both methods of calculating annual emissions will ensure that the boiler feedwater method is accurate. This permit contains new Engines #1 and #3, Caterpillar Model 3512B s, which replaced the two Model 3512B units listed in the previous State Permit to Operate FP-S-0118, issued on July 27, The facility has eliminated its Emergency Generator Unit #4, a Caterpillar Model 3412C unit, which was included in the State Permit to Operate FP-S-0118, issued on July 27,2000. DES has deleted the 7.1 gram per brake horsepower hour NO x emission limitation on Engines #1-3 from the previous State Permit to Operate FP-S-0118 issued on July 27, The applicable NOx RACT emission limit of 8.0 grams per brake horsepower hour or 2.44 lb/mmbtu has been added to the permit. All other hourly emissions limitations for the Wood-fired Boiler, Emergency Generator, and 3 Engines have been removed from the permit. DES has included consecutive 12 month emissions limitations in tons/year for each of the devices or groups of similar units. In that the permitted facility wide NO x emissions are above 50 tons per year, DES has included the requirement for an annual tune-up for the Wood-fired Boiler, which was omitted from the previous State Permit to Operate FP-S-0118 issued on July 27, 2000 along with NOx RACT testing of the Engines to be conducted once every 3 years. The facility s Engines #1-3 will be subject to Env-A 3700 beginning November 18, Temporary Permit FP-T-0021 issued on October 2, 1998 and State Permit to Operate FP-S-0118 issued on July 27, 2000 included two diesel oil-fired Boilers with maximum heat input rates of 8.37 and 9.9 MMBtu/hr from on road diesel fuel. In that these two units are below the permitting threshold of 10.0 MMBtu/hr heat input rate, being fueled by on road diesel fuel or No. 2 fuel oil, these two devices do not require an operating permit. Hence, DES will not include these two Oilfired Boilers in the new State Permit to Operate. However, the facility must track fuel use for these two units so that it can include the emissions of these two devices with their quarterly, facility wide emissions report. SUMMARY AND CONCLUSIONS DES has prepared a draft State Permit to Operate in preparation for issuing a final permit to the facility.

8 AFS #: Application #: FY Date: August 8, 2007 Page 8 of 8 Include Attachment A List of RTAPs and Emission Rates Evaluated Not applicable, Env-A 1400 is not applicable to the facility. H:\Permitting\Source Files\Durgin & Crowell\ FP-S-0118\Application Review Summary.doc

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